Major Airlines Expect Oil Prices To Rise

30. april 2018: Major Airlines Expect Oil Prices To Rise

Airplane

Four months ago several large air carriers said they were in no rush to start hedging against further price increases in crude oil and fuel. Now they may be starting to regret this decision: almost all major airline stocks are down on higher oil, and the price rise has pressured their earnings.

In its first-quarter report released yesterday, American Airlines said higher fuel costs had dented its revenues, increasing its expenses by US$412 million, with the average fuel price 23.6 percent higher in the first quarter of 2018 from a year earlier. For the full year, AA may have to cough up an additional US$2.3 billion in fuel costs if prices stay higher.

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